20241118_JOFOC_HDL_Cargo_Demonstration_Final_Signed.pdf

Rev.:5/2024

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

MARSHALL SPACE FLIGHT CENTER (MSFC)

CLASS JUSTIFICATION FOR OTHER THAN FULL AND OPEN

COMPETITION (JOFOC)

For Human Landing System (HLS) NextSTEP-2 Appendix H 80MSFC20C0034 and Appendix P 80MSFC23CA014; Human-class Delivery Lander Cargo Demonstration Missions

1. Federal Acquisition Regulation (FAR) 6.303-2(b)(1) – Identification of the agency and the contracting activity, and specific identification of the document as a “Justification for other than full and open competition.”

This document is a justification for other than full and open competition prepared by the National Aeronautics and Space Administration (NASA) Marshall Space and Flight Center

(MSFC).

The procuring agency is NASA and the contracting activity is MSFC.

2. FAR 6.303-2(b)(2) – The nature and/or description of the action being approved:

This Class justification encompasses sole source actions to be awarded to the existing Human Landing System (HLS) contractors, Space Exploration Technologies Corp. (SpaceX) under 80MSFC20C0034 for Appendix H, and Blue Origin, LLC (Blue Origin) under 80MSFC23CA014 for Appendix P, to conduct a Human-class Delivery Lander (HDL) cargo demonstration mission after successful completion of the Design Certification Review (DCR). These modifications are required in order to meet the Artemis mission-specific requirements of other NASA Programs and Projects. The general scope of both contract modifications is for execution of an HDL cargo demonstration mission after successful completion of DCR.

Under Appendix H and Appendix P of the NextSTEP-2 Broad Agency Announcement (BAA), NASA competitively procured the development and spaceflight demonstration of capabilities to land humans on the surface of the Moon and the development of large cargo lunar delivery capabilities through DCR. Appendix H was a phased procurement from inception that included three phases: the base period, Option A, and Option B. On May 13, 2020, NASA selected three (3) firms for the Appendix H base period contract awards: Blue Origin Federation (which merged with Blue Origin, LLC in 2022), Dynetics, and SpaceX.

Option A operated as a down-select from among the three base period contractors. In July 2021, NASA selected SpaceX for Option A award to develop an initial capability for crewed space transportation services to the lunar surface. Option B included a preliminary design review for a sustainable lander and a demonstration mission of the contractor’s sustainable lander capabilities.

In March 2022, NASA elected to procure the Design, Development, Test, and Evaluation (DDT&E) of a second sustainable lander capability through the NextSTEP-2 BAA under Appendix P. NASA also elected to award Option B in November 2022, thereby adding DDT&E for sustainable lander development and potential demonstration of the crewed lander capability to the Appendix H contract. The Appendix P contract was competitively awarded to Blue Origin, LLC in May 2023. Both contracts include options for HDL development in accordance with requirements that will lead to lunar landers with uniquely high capability of at least 12 metric tons of cargo to the Moon. Each contract has separate Contract Line Item Numbers (CLINs) for successive development through Preliminary Design Review (PDR), Critical Design Review (CDR), and DCR. Currently, NASA has exercised the option for the PDR CLINs on both contracts.

As part of NASA’s strategy for recurring crewed missions to the Moon, the agency is currently planning for two missions with cargo-delivery components: (1) the Pressurized Rover (PR), currently targeted for delivery to the surface no earlier than Fiscal Year (FY) 2032; and (2) the lunar surface habitat, currently targeted for delivery to the surface no earlier than FY 2033. Development of cargo-delivery capability is part of the existing Appendix H and Appendix P contracts to support possible NASA mission needs for Pressurized Rover and surface habitat delivery. As described below, these payloads are currently being developed under the Artemis program, and the payload providers have communicated an urgent need to begin mission specific integration activities with their respective lander providers.

Delivery of the PR to the lunar surface will expand lunar exploration, science capabilities, and utilization activities within the Artemis architecture. The PR is planned to have a pressurized cabin, allowing astronauts to live and work inside the vehicle to conduct exploration and science activities as they transit longer distances across the lunar terrain. The PR planned mission life is 10 years on the lunar surface, and it is capable of operating both crewed and uncrewed. The PR concept include the ability to-house and transport two crew members during the crewed portions of its mission and the ability to be operated remotely.

The PR is being designed and built by the Japanese Aerospace Exploration Agency (JAXA), with NASA providing delivery of the PR from Earth to the lunar surface. This mission is planned for award to SpaceX because their initial HLS mission award and associated lander development began earlier, and their schedule includes earlier Artemis crewed flight demonstrations, which enables them to meet the PR programmatic schedule with their HDL design.

The delivery of a lunar surface habitat will expand exploration capabilities within the Artemis architecture by enabling increased crew size, range, and duration of exploration missions while also establishing opportunities for Mars-forward precursor missions. As envisioned, a lunar surface habitat will house two crew members for a minimum of 7 days while they live and work on the lunar surface and will enable lunar exploration and science during crewed and uncrewed periods. This mission is planned for award to Blue Origin because their schedule is for a later Artemis crewed flight demonstration which enables them to meet programmatic schedule with their current design configuration of the HDL.

Both the PR and lunar surface habitat are substantially larger than any cargo that NASA and its industry partners have had the capability to land on the Moon since the end of the Apollo program. Only the two United States cargo landers under development through the HLS NextSTEP-2 Appendix H and Appendix P contracts can meet NASA’s Artemis requirements for performance, reliability, and schedule.

Additionally, PR and a lunar surface habitat are Human-class Cargo, as defined in the Appendix P and Appendix H contracts’ Statements of Work (SOW):

Human-class Cargo: A Class A or B payload (as defined in NPR 8705.4A, Risk Classification for NASA Payloads) that requires crew interaction on the lunar surface. Examples include, but are not limited to, a lunar pressurized rover and lunar surface habitat.

3. FAR 6.303-2(b)(3) – A description of the supplies or services required, to meet the

Agency’s needs (including the estimated value):

Space Policy Directive-1 instructs NASA to “lead an innovative and sustainable program of exploration with commercial and international partners to enable human expansion across the Solar System and to bring back to Earth new knowledge and opportunities. Beginning with missions beyond low-Earth orbit, the United States will lead the return of humans to the Moon for long-term exploration and utilization, followed by human missions to Mars and other destinations.”

To enact the direction provided in Presidential Space Policy Directive-1 for returning to the Moon, NASA is continuing to implement the Artemis Program. Further details about the NASA Artemis program may be found at: https://www.nasa.gov/artemisprogram.

To support NASA's Artemis campaign, as well as future requirements related to human activities on the lunar surface, deep space exploration, and crewed missions to Mars, NASA anticipates the need for future service acquisitions for both crewed and cargo missions to the lunar surface. These future service acquisitions are anticipated to employ services-based pricing, and NASA anticipates awarding at least two service contracts to ensure continuing competition.

Both Appendix H and Appendix P contracts currently contain option CLINs through DCR which allow for the design, development, and testing of the HDL capability. However, the contracts do not contain development beyond DCR, to include demonstration mission flights.

This procurement will add flight demonstrations of the HDL capability for both SpaceX and Blue Origin in preparation for future services missions.

The current period of performance for the Appendix H contract is from July 30, 2021 – June 30, 2027, with a firm-fixed price of $4.3B; including base and all options. The current period of performance for Appendix P is from May 18, 2023, to May 17, 2028, with a firm-fixed price of $3.4B; including base and all options. This modification would extend the period of performance for both awardees by no less than 48 months. The exact period of performance is contingent on acceptance of each contractor’s ability to meet the schedule.

4. FAR 6.303-2(b)(4) – An identification of the statutory authority permitting other than full and open competition:

The statutory authorities permitting other than full and open competition is 10 U.S.C.

3204(a)(1), as implemented by FAR 6.302-1, “Only one responsible source and no other supplies or services will satisfy agency requirements;” and 10 U.S.C. 3204(a)(3), as implemented by FAR 6.302-3, "Industrial mobilization, engineering, developmental, or research capability; or expert services."

5. FAR 6.303-2(b)(5) – A demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited:

The rationale supporting the use of 10 U.S.C. 3204(a)(1) is that there is a sound basis to conclude that the agency’s minimum needs can only be satisfied by the two current HLS contractors, SpaceX and Blue Origin. FAR 6.302-1(a)(2) permits NASA to procure supplies or services from a limited number of responsible sources where such supplies or services are only available from those sources and no other type of supply/service would satisfy agency requirements. Specifically, other than full and open competition is justified in this circumstance in accordance with FAR 6.302-1(a)(2)(iii)(A) “Substantial duplication of cost to the government that is not expected to be recovered through competition;” and (B) “Unacceptable delays in fulfilling the agency’s requirements.”

Additionally, limiting competition between SpaceX and Blue Origin through assignment of one mission to each contractor is supported by FAR 6.302-3(a)(2)(i) and FAR 6.302- 3(b)(1)(vi), in that this acquisition methodology provides for a more robust industrial mobilization base, strengthens domestic supply chains, and ensures the availability of future services related to lunar cargo transportation.

It is highly likely that award of a contract to a source other than SpaceX and Blue Origin for the HDL demonstration missions would result in unacceptable delays in fulfilling NASA’s requirements. Both SpaceX and Blue Origin have already completed significant DDT&E efforts relevant to the HDL systems under their current contracts. These efforts would be duplicated if NASA were to award a new contract to a third-party. Awarding this effort to current contractors will ensure the continuous availability of a reliable source of services for future lunar surface transportation requirements by pursuing a strategy that enables the development of two distinct lunar capabilities. NASA expects competition for future services contracts, which may exert downward pressure on pricing for lunar lander missions procured in the future.

The Government currently estimates the duplicated cost of awarding a demonstration mission to a contractor not currently on contract for HDL development to be greater than $2.5B, if the use of firm-fixed price milestone-based contracts are used, with potential for far more cost otherwise. Therefore, contracting with the existing Appendix H and Appendix P contractors avoids duplication of cost to the Government that is not expected to be recovered through competition. Additionally, the fact that significant corporate contributions were invested by both SpaceX and Blue Origin in addition to the value of their respective HLS contract awards is an indicator of the level of investment that would be required if NASA were to award a new cargo development and demonstration contract to a third party.

The design of the existing HLS contracts enabled cargo lander development to leverage the crew lander designs to the maximum extent possible. Given the high similarity between the crewed lander and HDL architectures for each of the existing Appendix H and Appendix P contractors, contracting with them avoids substantial duplication of cost to the Government.

The Appendix H and Appendix P contractors have been engaged in developmental efforts related to their respective lander architectures since April 2021 and May 2023, respectively.

These developmental efforts have involved substantial cost, which would be unnecessarily duplicated should the Government award a demonstration mission effort to a different contractor. The Government does not anticipate that this developmental cost would be recovered through competition.

Furthermore, through execution of their Appendix H and Appendix P contracts, both SpaceX and Blue Origin have achieved substantial progress in the DDT&E of their respective architectures. Both have demonstrated ability to advance their designs by consistently meeting and passing programmatic milestones including HDL milestones and other HLS milestones that are highly applicable to HDL due to the commonality between the crew and the cargo variants. Based on past performance, it is anticipated that both SpaceX and Blue Origin will successfully complete their HDL DDT&E, and both will be well postured to demonstrate their capability through the delivery of a cargo element to the lunar surface. In assigning one cargo element to each contractor, NASA would posture itself to have two proven contractors for future lunar service missions.

The PR and lunar surface habitat are novel, first-of-their-kind lunar surface systems with highly complex designs that must consider the capabilities of their respective landers. NASA has entered into an implementing arrangement with the Government of Japan for Japan to develop the PR and is working to complete a separate implementing arrangement for development of the lunar surface habitat. The providers of both the PR and the lunar surface habitat have imminent design milestones that require input from, and engagement with, their respective lander providers. Because of the extensive lander development progress made under current HLS contracts, SpaceX and Blue Origin are uniquely able to provide the requisite inputs with sufficient design maturity to the PR and lunar surface habitat providers as required their respective development schedules. Accordingly, this approach satisfies specific objectives of the Artemis program as well as international policy objectives of the United States.

While NASA assesses that either HDL contractor is capable of achieving programmatic requirements, based on the current Artemis schedule, the development schedules for both HDL contractors, as well as those for the PR and a lunar surface habitat, NASA has determined that assigning the PR to SpaceX and the lunar surface habitat to Blue Origin would provide the greatest opportunity for success and benefit to the Agency.

Conducting this procurement with other than full and open competition is further supported because NASA must establish and maintain a robust industrial base in order to ensure the availability and reliability of future lunar cargo transportation capability. By assigning one demonstration mission to each of the current HLS contractors, NASA will assure that it has more than one contractor with proven capability and heritage to achieve future mission objectives. This justification supports NASA's decision not to award two demonstration missions to a single contractor based on the need for industrial mobilization.

6. FAR 6.303-2(b)(6) – A description of the efforts made to ensure that offers are solicited from as many potential sources as practicable, including whether a notice was or will be publicized as required by Subpart 5.2 and, if not, which exception under 5.202 applies:

The Contracting Officer has determined that this action is not exempt from the notice required in FAR 5.201 and will be synopsized as part of any future award.

7. FAR 6.303-2(b)(7) – A determination by the contracting officer that the anticipated cost to the Government will be fair and reasonable:

The Contracting Officer’s signature on this document indicates that the Contracting Officer has determined that the anticipated cost to the Government will be fair and reasonable.

Blue Origin and Space X will be required to submit proposals to be evaluated and negotiated by the Government prior to execution of any modification which will add contract value. A proposal analysis will be performed to ensure that the final agreed-to price for the contract action is fair and reasonable. NASA shall obtain certified cost or pricing data when required by FAR 15.403-4 to establish a fair and reasonable price.

8. FAR 6.303-2(b)(8) – Description of the market research conducted, and the results, or a statement of the reasons market research was not conducted (e.g., urgent, and compelling requirement):

The proposed contract action is made under the terms of two existing contracts that were competed using full and open competition. Through the use of previous competitive activities, including the already established market research, and consultation with knowledgeable individuals in Government relative to aerospace activities, the Contracting Officer has determined that SpaceX and Blue Origin are the only two businesses that are capable of performing this requirement.

Establishing the capability to deliver large cargo elements to the Moon is a fundamental outcome of the current SpaceX and Blue Origin contracts. These contracts support the development and test of the lunar landers which NASA will need to demonstrate prior to any future transportation services missions. Both HLS contracts contain mission requirements to demonstrate crewed lunar landing capabilities; therefore, execution of cargo landing demonstrations aligns with the current contract structure for crewed demonstrations.

As noted in the respective selection statements for Appendix H and Appendix P, both Blue Origin and SpaceX have provided substantial benefit to the Government by virtue of the significant corporate contributions they each made to the development of their lunar landers:

"Blue Origin’s proposed corporate contributions demonstrate a significant investment in the Sustaining Lunar Development (SLD) efforts and future business capabilities to mature emerging space economies. This public-private partnership investment will greatly benefit the Government by reducing overall prices and enabling other segments of the Artemis Program."

"SpaceX’s plans to self-fund and assume financial risk for over half of the development and test activities as an investment in its architecture, which it plans to utilize for numerous commercial applications, presents outstanding benefits to NASA. This contribution not only significantly reduces the cost to the Government (which is reflected in SpaceX’s lower price), but it also demonstrates a substantial commitment to the success of HLS public-private partnership commercial model and SpaceX’s commitment to commercializing technologies and abilities developed under the Option A contract.”

9. FAR 6.303-2(b)(9) – Any other facts supporting the use of other than full and open competition:

None.

10. FAR 6.303-2(b)(10) – A listing of the sources, if any, that expressed, in writing, an interest in the acquisition:

The Contracting Officer has determined that this action is not exempt from the notice required in FAR 5.201 and will be synopsized as part of any future award.

11. FAR 6.303-2(b)(11) – A statement of actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required:

The Agency will continue to examine the market in the future for alternative solutions or new sources before executing any subsequent acquisitions for the same requirements.

Human-class Delivery Lander Cargo Demonstration

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

SIGNATURE PAGE

I certify that the facts presented in this justification are accurate and complete.

/ captured in NEAR / Tabitha Nichols Contracting Officer

CONCURRENCES:

/ captured in NEAR / Kristina Parmenter Competition Advocate MSFC

/ captured in NEAR / John E. Cannaday III Procurement Officer

Kameke Mitchell Head of Contracting Activity, ESDMD

Kameke Mitchell Digitally signed by Kameke Mitchell Date: 2024.11.17 18:12:44 -05'00'

/ captured in NEAR / Dr. Lisa Watson-Morgan HLS Program Manager

I hereby certify that the above justification is complete and accurate to the best of my knowledge and belief.

Tabitha Nichols

Digitally signed by Tabitha Nichols Date: 2024.11.18 09:42:49 -06'00'

Lisa Watson-morgan

Digitally signed by Lisa Watson-morgan Date: 2024.11.18 12:02:51 -06'00'

Kristina Parmenter

Digitally signed by Kristina Parmenter Date: 2024.11.18 12:29:50 -06'00'

John Cannaday

Digitally signed by John Cannaday Date: 2024.11.18 13:48:05 -06'00'

Human-class Delivery Lander Cargo Demonstration

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

SIGNATURE PAGE

/ igned in NEAR / Scott Barber Office of the General Counsel at Headquarters

Marvin Horne Agency Competition Advocate

APPROVAL:

Karla Smith Jackson Senior Procurement Executive

Marvin Horne Digitally signed by Marvin Horne Date: 2024.11.17 18:30:00 -05'00'

Karla Smith Jackson

Digitally signed by Karla Smith Jackson Date: 2024.11.17 18:58:27 -05'00'

SCOTT

BARBER

Digitally signed by SCOTT

BARBER

Date: 2024.11.18 17:09:15 -05'00'